Loss of use is the rental income a company says it lost while a damaged car was off the road; diminished value is the drop in the car’s value after a repair.
- These fees can only be charged if your contract provides for them, and the company should be able to show how it calculated them.
- Ask for the number of days, the daily rate and the repair dates, and check whether the total stays within the excess or maximum liability you agreed.
The repair cost is often only one line in a damage claim. Below it you may find ‘loss of use’, ‘downtime’, ‘immobilisation’ or ‘diminished value’, sometimes adding a large amount to the total. These extra fees can only be charged if your contract provides for them, and the company should be able to show how each one was calculated. This article explains what they mean and how to check them.
What do these fees mean?
| Fee | Also called | What the company says it covers |
|---|---|---|
| Loss of use | Downtime, immobilisation, out-of-service fee | Rental income lost while the car was being repaired |
| Diminished value | Depreciation, loss of value | The lower market value of the car after a repair |
| Administration fee | Handling or processing fee | The cost of handling the damage case |
| Appraisal fee | Expert or assessment fee | The cost of an expert who assessed the damage |
They are not the same as the repair itself. A repair cost replaces what was broken; these fees cover what the company says it lost on top of that. Our article on what a damage claim should contain gives an overview of all common extra lines.
When can a rental company charge loss of use?
There is no single EU rule on loss of use in car rental. In practice, what counts first is your contract. If your rental terms do not mention loss of use or a similar fee, you can ask the company on what basis it charges it.
Industry codes expect these items to be made clear in advance. The UK BVRLA Rental Broker Code of Conduct says customers must be told their maximum liability, and that this includes items such as administration fees, tax, loss of use or recovery charges. In other words, loss of use should fall within the maximum you were told about, not come as a surprise on top.
The European rental industry code of Leaseurope says companies should provide information on the damage matrix or similar to help substantiate estimated costs, and should be clear about who is responsible for damage. The same logic applies to every line in the bill: you should be able to see how it was reached. ECC Ireland puts it plainly: the company must be able to detail each additional charge and why it added it.
Can a clause on loss of use be unfair?
Rental terms are standard terms you could not negotiate. Under the EU Unfair Contract Terms Directive, a standard term that causes a significant imbalance to your detriment, contrary to good faith, is not binding on you, and unclear terms are interpreted in your favour. A clause that allows a high fixed loss of use fee regardless of how long the car was really off the road may be worth questioning. Whether a specific clause is unfair is decided case by case. Read unfair terms in rental contracts.
Find the clause
Look in your terms for loss of use, downtime, immobilisation, depreciation or loss of value. Note how it is calculated: a fixed amount, a number of days times a daily rate, or ‘actual loss’. Our terms check highlights such clauses.
Check the number of days
Loss of use should relate to the time the car was actually out of service for the repair. Ask for:
- the date the car went to the repairer and the date it came back;
- the repair invoice, which usually shows the dates and the hours of work;
- whether the car was rented out again in the meantime.
A small scratch that takes a few hours to fix does not normally keep a car off the road for a week. If the claim is based on an estimate and the car was never repaired, ask the company to explain the days. See an estimate instead of a repair invoice.
Check the daily rate
Ask which daily rate was used and why. A rate far above what you paid for the same car may need explaining. Konsumentverket, the Swedish consumer agency, says you can ask the company for evidence such as photos, records and receipts for repair costs, and you can apply the same request to the loss of use calculation.
Check diminished value with care
A claim for diminished value says the car is worth less after a repair. For a rental car that will be sold after a set period, this is a specific claim that needs support. Ask whether your contract mentions it, and for an expert report that explains the amount. If there is none, ask the company how it reached the figure. For a second opinion on damage and repair costs, see an independent damage assessment.
Compare the total with your excess
Add up the repair, loss of use, fees and any diminished value. Then compare the total with the excess or maximum liability in your contract. If your contract caps your liability, check whether the extra fees count within that cap or come on top. Our excess calculator helps you work out what you should pay and what your insurance should cover.
Object to what is not supported
Write to the company, accept the parts you agree with if any, and dispute the rest with reasons. Our letter templates help you structure the letter.
Claim reference: [reference] Your claim includes [amount] for loss of use for [number] days at [rate] per day, and [amount] for [diminished value or other fee]. Please send the clause in my rental terms that provides for these fees, the dates the car was out of service, the repair invoice and the calculation of each amount. Please also confirm how the total relates to the excess of [amount] in my contract. Until I receive this, I dispute these items.
If the company does not explain the fees, the European Consumer Centre in your country can help with a cross-border dispute; see how an ECC complaint works. For the full objection, follow how to dispute a damage claim.
Frequently asked questions
Is loss of use covered by my excess?
That depends on your contract. Under the UK BVRLA broker code, the maximum liability you are told about includes items such as loss of use. Other contracts may charge them on top. Check the clause on your maximum liability and ask the company to explain how the total relates to your excess.
Can they charge loss of use if the car was never repaired?
Loss of use is meant to cover a period when the car could not be rented. If the car was rented out again straight away, or never went to a repairer, ask the company to show when the car was actually off the road.
Does my separate excess insurance pay for loss of use?
Some policies do, some do not, and some set a limit. Read the policy wording for loss of use, administration fees and similar costs before you claim, and send the itemised bill with your claim.
Sources
- bvrla.co.ukBVRLA: Rental Broker Code of Conduct (PDF)
- leaseurope.orgLeaseurope: Code of Best Practice for the car and van short term hire industry (PDF)
- konsumentverket.seKonsumentverket: Problems with your rental car
- eccireland.ieECC Ireland: Car hire in Europe, help and advice for a smooth journey (9 May 2025)
- commission.europa.euEuropean Commission: Unfair Contract Terms Directive